Why are VA Loans Are The Best Type of Loan For Military Veterans?
There are a number of benefits to using your VA Home Loan. Here’s why the VA Home Loan is helping more Veterans become homeowners than ever before: You don’t need a large down payment. While other home lending options often require a minimum downpayment of 3.5% the VA Home loan is a 0% loan, which means that beyond paying fees and closing costs a veteran is not required to put any money down on the purchase of their new home.
You won’t have to pay costly mortgage insurance.
FHA and Conventional loans with less than a 20% down payment typically have a P&I insurance added onto their monthly payment. The extra charge helps offset the risk to your lender, and it’s especially common for government-backed loans, such as FHA and USDA mortgages, which typically allow minimal down payments and are popular among first time homebuyers. In contrast, the VA Home Loan is guaranteed by the United States government and therefore is not subject to this ongoing fee. This is a HUGE benefit to our Veteran homeowners and can save them tens of thousands over the life of their loan. Closing costs can be paid by the borrower, seller, or lender. Any home loan is going to have closing costs associated with obtaining the financing. This cost can be anywhere between 1-2% of the purchase price of the home. VA Home Loan users are given the unique ability to tack this cost on the balance of their mortgage (often in exchange for a higher interest rate) vs having to pay cash at closing.
The VA will not charge a funding fee if you are a disabled Veteran.
Any qualifying veteran who receives or is eligible to receive VA compensation for service-connected medical conditions, disabilities, or related issues (as determined by the VA) is exempt from paying the otherwise-mandatory VA loan funding fee. Typically this can translate to thousands in savings.
The ability to realize the American Dream should be an honor bestowed upon every man and woman who has honorably served our country. There truly is no greater benefit to our military Veterans than the VA Home Loan.